Hyderabad: The Telangana government on Monday made a faux pas regarding the increase in VAT (value-added tax) on petrol and diesel. The commercial taxes department issued GO 31 on Monday stating that the VAT on petrol had been increased from 35.2 per cent to 40 per cent and on diesel from 27 per cent to 32 per cent. However, it withdrew the GO immediately without citing any reason.

The GO, which was released without any prior notice to the Oil Marketing Companies or petrol pumps, created a stir as there was utter confusion between them over the quantum of price hike to be effected and from which date. Local news channels scrolled the news prominently, forcing the Chief Ministers’ Office to issue a clarification immediately.
The CMO release stated: “In certain sections of media, there are reports that the VAT on petrol and diesel have been increased. This is not true. In fact VAT rate on petrol and diesel were increased in the month of January 2015 itself.

“The VAT rate on petrol was increased from 31 per cent to 35.2 per cent and on diesel from 22.25 per cent to 27 per cent at that time. Apart from that there is no proposal or decision to increase the VAT rate as appeared in the media.”

The commissioner of commercial taxes, Mr V. Anil Kumar, said, “There was a communication gap between our department and Secretariat officials, which resulted in issuance of the GO.”